InitiativeGiven the high prevalence rates of trauma exposure in youth in residential treatment, evidence-based guidelines are needed to identify youth most likely to benefit from this setting. We examined trauma exposure, functional impairments, and treatment outcomes in a large clinical dataset. When compared to youth in nonresidential settings (n = 9,942), youth in residential settings (n = 525) reported both higher rates of trauma exposure across types and higher rates of impairments. Moreover, as the number of trauma types increased among youth in residential care, so did the rates of impairment. Pretreatment and post-treatment rates of impairment significantly decreased in both groups; however, nearly a third of the youth in residential care continued to manifest some impairment. Implications for practice, policy, and research are discussed.